Question

Beginning $24,100 $17,600 $3,700 $0 balance Direct $6,000 materials $8,800 $10,500 $9,700 Direct labor $980 cost $980 $1,660 $150 Job 13- Job 13- Job 13- Job 13- 43 44 45 46 Number of moves 43 54 26 5 Number of 29 39 17 16 change orders Direct labor hours 980 980 1,660 150 By July 31, Jobs 13-43 and 13-44 were completed and sold. Jobs 13-45 and 13-46 were still in process, Required: 1. Calculate the activity rates for each of the three overhead activities. Round all activity rates to the nearest cent. Materials handling per move rate Engineering rate $1 per change order per direct labor Other overhead rate hour 2. Prepare job-order cost sheets for each job showing all costs through July 31. When required, round your answers to the nearest dollar. If an amount is zero, enter "O". Heitger Company Job-Order Cost Sheets Job 13-43 Job 13-44 Job 13-45 Job 13-46 Balance, July 1 Direct materials Direct labor cost Materials handling Engineering Other overhead Total 3. Calculate the balance in Work in Process on July 31. 4. Calculate the cost of goods sold for July. 5. What if Job 13-46 required no engineering change orders? What is the difference in the new cost of Job 13-46? How would the cost of the other jobs be affected?

Answer 1

1 Calculation of Activity rates Materials Handling rate $ 24.30 Per Move Engineering rate $ 16.80 Per Change Order Other Overhead rate $ 5.90 Per Direct Labour Hour Working ($97,200 / 4000 Moves) ($109,200 / 6500) ($265,500 / 45000)

2 Balance, July 1 Direct Materials Direct Labour Cost Materials Handling Engineering Other Overheads Total Heitger Company job-Order Cost Sheet Job 13-43 Job 13-44 Job 13-45 Job 13-46 $ 24,100 $ 17,600 $ 3,700 $ $ 6,000 $ 8,800 $ 10,500 $ 9,700 $ 980 $ 980 $ 1,660 $ 150 $ 1,045 $ 1,312 $ 632 $ 122 $ 487 $ 655 $ 286 $ 269 $ 5,782 $ 5,782 $ 9,794 $ 885 $ 38,394 $ 35,129 $ 26,571 $ 11,125 3 Balance in Work in process on July 31 Cost of Goods Sold for July $26,571 + $11,125 $38,394 + $35,129 $ 37,697 $ 73,524 4 Note: Please Comment down for any further clarifications.